Wells Fargo Raises Price Valuation Range on Capital One Financial (COF), Strong Signs of Growth with Early Release
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Price: $227.34 +1.57%
Rating Summary:
28 Buy, 14 Hold, 2 Sell
Rating Trend:
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Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
28 Buy, 14 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Wells Fargo is maintaining its Market Perform rating on shares of Capital One Financial (NYSE: COF) while raising its price target range from $52-$58 to $53-$59.
COF released its results on July 13, ahead of its expected date of July 21 due to the fact that it also announced a $2 billion equity offering to fund its acquisition of ING Direct. EPS of $1.97 came in above the Street's estimate of $1.59 as a result of greater-than-expected reserve releases. Total revenue rose 2.3 percent year-over-year to $3.993 billion as its loan balance increased $4.9 billion to $129 billion.
The company's Tier 1 common equity ratio was roughly 9.2 percent as of June 30, 2011, up 80 bps from 8.4 percent on March 31, 2011.
The firm is raising its 2011 and 2012 EPS estimates from $5.88 and $5.25 to $7.28 and $5.92. It reiterated its revenue estimates of $16.25 billion and $17.3 billion.
COF stated that will not host a conference call on July 13 or July 21.
An analyst at Wells Fargo comments, "In recent periods, earnings have benefited from reductions in charge-offs and loss reserves and we expect this to continue. However, we believe that COF shares are fairly valued at current levels. We don't expect COF to reverse declining revenue trends associated with a contracting loan portfolio and a declining revenue margin until Q4-2011."
For more ratings news on Capital One Financial click here and for the rating history of Capital One Financial click here.
Shares of Capital One Financial closed at $52.24 yesterday.
COF released its results on July 13, ahead of its expected date of July 21 due to the fact that it also announced a $2 billion equity offering to fund its acquisition of ING Direct. EPS of $1.97 came in above the Street's estimate of $1.59 as a result of greater-than-expected reserve releases. Total revenue rose 2.3 percent year-over-year to $3.993 billion as its loan balance increased $4.9 billion to $129 billion.
The company's Tier 1 common equity ratio was roughly 9.2 percent as of June 30, 2011, up 80 bps from 8.4 percent on March 31, 2011.
The firm is raising its 2011 and 2012 EPS estimates from $5.88 and $5.25 to $7.28 and $5.92. It reiterated its revenue estimates of $16.25 billion and $17.3 billion.
COF stated that will not host a conference call on July 13 or July 21.
An analyst at Wells Fargo comments, "In recent periods, earnings have benefited from reductions in charge-offs and loss reserves and we expect this to continue. However, we believe that COF shares are fairly valued at current levels. We don't expect COF to reverse declining revenue trends associated with a contracting loan portfolio and a declining revenue margin until Q4-2011."
For more ratings news on Capital One Financial click here and for the rating history of Capital One Financial click here.
Shares of Capital One Financial closed at $52.24 yesterday.
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